There are many different approaches and conceptualizations of flexibility i
n the present literature. This lends itself to a lack of clarity and can re
sult in confusion on the central concept. Here we identify shortcomings in
the existing literature. To clarify some of the important concepts, we dist
inguish between flexibility (ability to change states), adaptability (abili
ty to change within a state), and efficiency (resources utilized). To illus
trate such distinctions, we present a capacity expansion model that takes f
lexibility and adaptability into consideration. Numerical examples show how
the concepts of flexibility and adaptability can be used in manufacturing.